This paper aims to estimate the elasticity of substitution between land and non-land factors in Danish housing production, which is a parameter utilized in MAKRO. By using the latest property and land assessments from Vurderingsstyrelsen (the Danish Property Assessment Agency), a CES-production function is estimated simultaneously with a house producing agent’s first order conditions, resulting in an estimate of 1.14. This aligns closely with the currently employed estimate in MAKRO, 1.16, derived from a study by Epple et al. [2010], who rely on American urban area data. Given the Danish macroeconomic context, we expect the estimate proposed in this paper to be more appropriate for use in MAKRO.